Published on Pambazuka News, Interview with Oakland Institute on Socfin investments in Sierra Leone, May 2, 2012.

A new report from the Oakland Institute examines a controversial land investment deal in Sierra Leone. Pambazuka News caught up with Oakland Institute Policy Director Frederic Mousseau to find out why the report has attracted so much attention … //

FREDERIC MOUSSEAU: What we found during the course of field work and in communication with the villagers, was that the local farmers and landowners are not against investment. However their concerns are about the way the lease was negotiated, the resulting loss of livelihoods and natural resources, and about the low wages and bad working conditions on the plantation. We also realized the dramatic power imbalance prevailing in this conflict: a few hundred farmers and land owners on one side and the government of Sierra Leone and its police backing a firm which is a subsidiary of a giant multinational group. Socfin SL is a subsidiary of Socfin (Société Financière des Caoutchoucs), an investment holding company, whose main shareholder is Vincent Bolloré, a prominent French businessman, who manages myriad of companies worldwide through his Bolloré Group.

During our research we also realized that the grievances of Sierra Leonean farmers over Socfin’s palm oil plantations are virtually identical to those of the farming communities from around the world who are challenging investments made by other Socfin’s subsidiaries. These subsidiaries operate within a complex web of over 30 different companies, registred in Asia, Africa as well as Belgium and several tax havens such as Luxembourg, Liechtenstein and Guernsey. Operating under different names – SOCAPALM in Cameroon, LAC in Liberia, Socfin KCD in Cambodia – several Socfin subsidiaries have faced very similar accusations of land grabbing and investment malpractices in recent years. For instance, peasant farmers from the Bunong minority in Cambodia have been protesting since 2008, claiming that the land leased for the rubber plantation by the government belonged to them and should be returned to them.

PAMBAZUKA NEWS: Despite resistance in several countries Socfin has managed to operate and business is as usual. How do you explain that?

FREDERIC MOUSSEAU: The Oakland Institute report shows how Socfin’s plantations have faced resistance by local populations and indigenous groups, and how Socfin’s subsidiaries systematically use the threat of legal action against their critics. In 2010, the group sued a French journalist and a photographer for their respective reporting over the activities of SOCAPALM in Cameroon. The photographer, Isabelle Alexandra Ricq, was sued after she had described the problems on and around the firm’s oil palm plantations in Cameroon, the dismal living conditions of the Bagyeli people, the problems of deforestation, the lack of access to land, and the deplorable conditions faced by plantation workers who call themselves SOCAPALM’s slaves.

While farmers opposing the plantations were put in jail and now await trial in Sierra Leone, experience from around the world confirms how risky it is to criticize the firms controlled by Bolloré and his associates.

PAMBAZUKA NEWS: How do you respond to a business like Socfin who would say that they are following the norm in Sierra Leone, and are not breaking any law?

FREDERIC MOUSSEAU: I think that Bolloré and his associates in Socfin can do far better to meet the demands of farmers and workers in Sierra Leone and elsewhere.

If one takes for instance the low level of wages, set at 250,000 Leones per month ($50) for six days a week, eight hours per day, in its response to our report, Socfin provides a convenient argument. It claims that it is applying the local labour law and does not want to ‘create an imbalance on the macro-scale of the country’. It also states that it is committed to providing a $75,000 social development fund in addition to the compensation and the rent it is paying for the 6,500 ha plantation in Sierra Leone.

This looks certainly significant for most Sierra Leoneans given the deep level of poverty in a country where the average income doesn’t exceed $1 a day. However, it is out of proportion with the profits recorded by the company. With 158,800 ha of plantations in Asia and Africa, Bolloré Group recorded $250 million net profit in 2011, an increase of $163 million (187 per cent) since 2009. Such figures correspond to an average gain of $1,500 per hectare of plantation per year, i.e. over $10 million per year on a 6,500 ha of plantation. Even if a new plantation takes a few years to become productive and beneficial to the investor, Socfin disposes of plantations at different stages of growth in various countries, which do provide the firm with financial resources that could be spent in favor of local populations in new investments as well. But obviously, this will have a marginal impact on the returns provided to its shareholders.

The Bolloré group is currently one of the world’s top 500 companies, with an annual turnover of more than seven billion Euros. Its global expansion has been largely concentrated in Africa, where it now operates in 43 countries and has become a key player in the economic structure and political life of many countries. Vincent Bolloré – the 18th wealthiest man in France in 2009 – has built an empire with far more extensive outreach than the former French colonies. He has gained control of not only plantations throughout Africa, but also manages a large portion of the shipping and transport industry, as well as oil companies. Bolloré group controls over 13 African ports, including a 20-year concession of the port of Freetown, secured in December 2010.

By expanding its presence in both production and transport, the Bolloré Group is developing a model of integration, which covers a range of activities geared toward the extraction of natural resources from developing countries, particularly Africa. The Group is increasingly reaching a situation of monopoly or quasi-monopoly over critical economic sectors, including transport in many countries. Such a hold on power carries major risks for local populations and governments who are progressively losing control not only over their production but also trade flows in and out of the country. Disempowering people and governments, such an expansion strategy clearly contradicts the Group’s stated commitment to sustainable development.